Are you looking for car insurance options? Do you want to know what Liability Insurance is?
To begin, if you have a car or want to purchase one, you should know that Liability is one of the mandatory insurance policies for all drivers. Since it is part of the responsibility that must be fulfilled if third parties are affected.
In this article we will focus on knowing Liability Insurance, how it works, coverage because it is important if you have a business, and the types of civil liability.
Before, let’s start by answering the question:
What is Liability?
Liability Insurance in Spanish: Responsibility Insurance, is protection coverage against damages and claims for injuries to people or property.
In other words, the coverage provided by this insurance pays for damages in accidents and damages caused by your responsibility.
Except for: Florida, New Hampshire, and Virginia where Liability is not mandatory.
But, if you live in New York, California, Houston, Michigan, or the rest of the States, you will have to purchase Liability Insurance.
What is Liability Insurance coverage?
In addition to knowing what Liability Insurance means, you should keep in mind that this insurance has two types of coverage:
1. Property Damage Coverage
This includes:
- Damage to other vehicles
- Repairs to the patio of a home
- Or any property damaged as a result of the accident.
2. Coverage for physical damage
It covers:
- Injuries and blows.
- Medical bills.
- Medication prescriptions.
- Loss of wages.
3. Additional coverage
- A rental vehicle for the time the damaged car is in the shop.
- Difference between the value of a car before an accident and the price after it was repaired.
How does Liability Insurance work?
On the other hand, Liability auto insurance works to protect a driver financially from high bills.
Of course, liability coverage only works to cover third-party expenses, not your vehicle.
Also known as: third-party insurance, they also work for business owners who inadvertently cause damage to others with their cars.
Why is it important for your business?
Liability insurance, in this case, Commercial, is important for your business because they are subject to claims for injuries and damage to private property.
However, businesses or small businesses usually work with a tight budget, which is why they do not see the relevance of purchasing any type of insurance.
By not having coverage, the damages will be covered with money from the business or from whoever commits an accident apart from facing legal issues.
Also add that, just like a person with a vehicle, Liability Insurance will not help an employee recover from damages that occur while working.
If this type of case arises, it is necessary to purchase workers’ compensation coverage. For more information watch this video.
Types of Liability Insurance
Knowing what Liability is also implies knowing that there are different classifications or types of Liability Insurance.
We detail some of them in the following list:
1. GENERAL CIVIL LIABILITY INSURANCE
Covers claims, bodily injuries, or damage to another’s property or someone’s assets.
2. HOMEOWNERS LIABILITY INSURANCE
Another Liability insurance is aimed at homeowners.
Provides financial protection if you are responsible for a guest, visitor or tenant being injured inside your home.
3. PROFESSIONAL LIABILITY INSURANCE
This coverage covers legal costs and lawsuits if a client sues a company for errors or omissions in its professional services.
4. MOTORCYCLE LIABILITY INSURANCE
Similarly, motorcycle liability insurance is divided into two parts: injuries and damage to private property.
5. EMPLOYER LIABILITY INSURANCE
All employers must purchase insurance to protect the company from liability arising from the injury or death of an employee.
